Vodafone has acquired a controlling stake in Ghana Telecom from the Government of Ghana for $900 million as part of the mobile phone giant’s strategy to expand in to emerging markets.

The mobile operator, which has been acquiring businesses in emerging markets in the past two years following investor concern about slower growth in Europe, announced yesterday that it has bought a 70 per cent stake in Ghana’s third largest mobile phone group and its largest fixed line operator.

In Ghana, which has a total population of 24 million with more than 50 per cent under the age of 25, mobile phone sales are growing at a rapid rate, with 2.7 million subscribers added in 2007.

“Ghana is one of the most attractive markets in Africa with mobile subscribers growing at more than 55 per cent per annum and mobile penetration around 35 per cent,” said Arun Sarin, Vodafone’s chief executive.

A Vodafone spokesman added that it was particularly attracted to Ghana’s stable political background, adding that it the group may consider further expansion in West Africa.

Ghana Telecom has a 17 per cent market share, or 1.4 million customers, in the country’s mobile market.

Vodafone added that Ghana Telecom will invest $500 million over the next five years restoring and expanding network coverage. As part of the deal, the Government of Ghana, which will retain a 30 per cent stake, has agreed to transfer its fibre-network assets to Ghana Telecom.

Ghana’s mobile market is dominated by South African-based MTN, which has just over a 50 per cent share of the market, and currently in takeover talks with India’s Reliance Communications. Luxembourg-based Millicom, has about 30 per cent of the market.

Ghana Telecom has not performed as well as its rivals in the last year, seeing its market share fall slightly. Vodafone, believes that the business can do better and is targeting a 25 per cent market share within five years.

The African mobile operator said that 2007 earnings were $42 million on sales of $290 million. The deal still needs approval from the Ghanaian parliament but the transaction is expected to close in the third quarter of 2008.

Vodafone had 252 million global customers at the end of 2007, of which 106 million were in growth markets in Eastern Europe, the Middle East, Africa and Asia.

Vodafone bought a 52 per cent stake in Hutchison Essar, now India’s third-largest wireless operator, for $10.7 billion in May 2007, and purchased Turkey’s Telsim Mobil Telekomunikasyon Hizmetleri AS for $4.55 billion in 2006.

Earlier this year, Vodafone said that it wanted to increase its 50 per cent stake in Vodacom Group, South Africa’s biggest mobile phone operator by subscribers. Since the end of 2005, Vodafone has sold its units in Japan and Sweden, as well as stakes in Swiss and Belgian mobile-phone companies, for a total of $21.8 billion.

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